Plenty of new media business launches have been met with skepticism, often undue. The New European, in the UK, was laughed at as a print experiment in the digital age, but has proved sustainable long after its Brexit-based inception. BuzzFeed was initially met with derision by much of the media and, while its recent struggles reflect over expectation and some tragic, strategic mistakes, its golden period showed that you could deliver high-quality journalism built for the social web.
But while the naysayers are often proved wrong, those skeptical about one recent launch appear to have rapidly been proved right.
The Messenger launched in May last year with the grand aims of employing 550 journalists and building a $100mn revenue business by 2024, backed by an initial $50mn in investment raised by media entrepreneur Jimmy Finkelstein, frormer owner of The Hill.
The plans raised eyebrows for a number of reasons, not least the idea that digital advertising would support that scale of newsroom.
Less than a year later, it is reported that the Messenger will run out of cash by the end of this month. A pitchdeck being used in a bid to raise an additional $20mn, as recently as December last year, forecast a surge in digital advertising revenue for 2024 to $55mn from just $3.8mn in 2023, but also revealed it made a loss of $43mn in 2023.
For context, that $55mn figure is roughly half The Guardian’s total print and digital advertising revenue for 2023. That previously touted $100mn target would be somewhere in the region of a third of what the New York Times, one of the largest and most successful news organizations in the world, makes from digital advertising in a year. It would be charitable to call those figures ambitious.
It was, frankly, not hard to see this coming.
The Messenger’s pitch at launch was for a new “balanced, trusted, non-partisan” news source that would be above all else “accurate” and “fast”, all funded by digital advertising. It seemed to many media watchers like a business built for a media environment of a decade ago or more, built on some pretty fundamental misconceptions about what works for news media.
For starters, digital advertising in media hasn’t looked like a promising core revenue stream to support quality journalism for some time as tech platforms have hoovered up ever larger shares of the ad market. While ad-focused news organisations like the UK’s biggest news group, Reach Plc, have struggled, the success stories of the past few years have almost all come from media organisations with at least some form of subscription revenue (see, of course, the New York Times but also the new wave of Axios, Puck and Air Mail).
The only way to make digital advertising work, certainly at a level that will support a newsroom of 300 that the Messenger has created, is to generate huge scale. The Messenger’s own goal is 100mn unique readers a month. But the social media tricks that built huge audiences in the 2010s are no longer a viable route. That means search and direct traffic are the primary route for The Messenger.
Joshua Benton in Nieman Lab was dismissive: “The thing that’s confusing about The Messenger to everyone else in the media world is that its ideas don’t make any sense. It’s in an aggressive sort of denial about the world of digital news publishing in 2023. It’s LARPing an earlier time. The Messenger thinks it will reach 100mn monthly uniques on the back of bland aggregation…. It thinks it can support a 550-person newsroom on programmatic advertising. The Messenger thinks the right pitch for a site funded by Republican mega-donors is: ‘We’re the unbiased ones!’”
Benton tweeted: “When was the last time a US digital news publisher *launched* with a 175-person newsroom? I think the answer is ‘never, and there’s nothing even close.’”
This brings us to the second big misconception at the heart of The Messenger model. The idea that there is huge untapped demand for unbiased quality news.
That belief seems, at best, to have been based on surveys of the US public which show that Republicans think the media has a liberal bias. It’s perhaps not a huge surprise then that when The Messenger announced it had struck a deal to use AI technology to police its output for bias, it managed to identify sources of misinformation such as Breitbart and ZeroHedge, or right-leaning publications such as the New York Post or the Daily Mail, as highly reliable, while considering left-leaning publication such as the New York Times unreliable.
The whole project has seemed dreamy ever since Finkelstein raised what (in the post- BuzzFeed and Vice era) seemed like too much money and told the New York Times in March 2023: “I remember an era where you’d sit by the TV, when I was a kid with my family, and we’d all watch 60 Minutes together. Or we all couldn’t wait to get the next issue of Vanity Fair or whatever other magazine you were interested in. Those days are over, and the fact is, I want to help bring those days back.”
But, even if the Messenger really was able to deliver straight-down-the-line unbiased reporting, it is doubtful that it would ever have brought it the kind of audience needed to sustain its business. Smart news outlets have built loyal audiences and, in particular, subscriber bases through differentiation either in investigative reporting, commentary or other content that sets them apart and creates identification with their brand. The Messenger’s own vision would make its output indistinguishable from wire copy, lost amid a sea of search results for exactly the same story written by more established outlets. And, indeed, it seems that a lot of its output, often churned out at a huge rate has actually been re-written stories from elsewhere.
So what we’re left with is a media outlet deliberately eschewing anything that would make it distinctive, with a hugely expensive newsroom that needs to generate huge traffic in order to generate sufficient revenue from digital advertising.
The whole story makes me think of this tweet.
The only difference being that it seems those running The Messenger seem unable to see that, maybe, the haters were right.
